Wells Fargo and Goldman Sachs, both holding major investment and loan portfolios in fossil fuel projects, have filed motions to exclude from their proxies a climate-related shareholder resolution. The US Securities and Exchange Commission (SEC) recently granted the two banks the right to prevent shareholders from raising the issue with other shareholders, management, and the banks' boards.
The resolutions ask for a reduction in the full carbon footprint of their loan and investment portfolios in alignment with the 2015 Paris Agreement’s goal of maintaining global warming well below 2 degrees. The resolution states banks create significant climate risk by financing fossil fuel projects and infrastructure which lock in carbon emissions for decades. Wells Fargo, Goldman Sachs, and other US banks are accused of ignoring or downplaying their role in creating climate emissions, and of failing to begin measuring the emissions associated with their fossil fuel investments and loan portfolios, while other banks are taking action. BBVA, Standard Chartered, BNP Paribas, Société Générale, and ING have committed to decrease the climate impact of their loans in alignment with Paris climate goals. Others are working to develop the methodologies needed to measure banks’ full carbon footprints. Some banks, such as BNP Paribas are also committing publicly to reduce or eliminate their financing of some of the highest-carbon, highest-cost fossil fuel projects, including tar sands or Arctic drilling.
'Issue will not go away'
Reacting to the SEC ruling, Danielle Fugere, president of the NGO As You Sow, said ‘we are very disappointed that these banks refuse to allow this important issue to be raised and voted on by other shareholders. This issue will not go away by ignoring it. Every dollar that banks like Wells Fargo and Goldman Sachs invest in new fossil fuel infrastructure increases risk and slows transition to a clean energy economy. Common sense proposals asking banks to measure and reduce their extensive carbon footprints should not be off limits to shareholders whose portfolios face value destruction from climate impacts.’ As You Sow is a nonprofit organization that promotes environmental and social corporate responsibility through shareholder advocacy, coalition building, and innovative legal strategies. Lila Holzman, energy program manager of As You Sow, added ‘it is unacceptable for banks like Wells Fargo and Goldman Sachs to continue financing high-risk fossil fuel projects like Arctic drilling and tar sands. Despite this unfortunate SEC ruling, we hope to continue our dialogues with companies in the financial sector to raise shareholder concerns regarding the role banks play in increasing climate catastrophe.’